U.S. President Donald Trump said he will impose a 25% tariff on Mexico and Canada starting on Feb. 1.
On the 30th (local time), President Trump met with reporters in the Oval Office of the White House and, in response to a question from the press about whether the tariffs on Canada and Mexico would start on Saturday (Feb. 1), he answered, "It will be on Saturday, the 1st."
Earlier, President Trump had declared he would impose a 25% tariff until the two countries sufficiently cooperated to block drug trafficking and illegal immigration into the United States, announcing Feb. 1 as the start date for the tariffs.
President Trump stated, "I'm going to impose a 25% tariff on Canada and separately a 25% tariff on Mexico," adding, "We really have to impose tariffs because we are seeing a very large trade deficit with these countries. This tariff could go up over time or it might not."
President Trump responded that the tariff on Canadian oil has not yet been determined. He noted, "I will probably make a decision on oil tonight," suggesting that the implementation of the tariff on Canadian oil would depend on oil prices.
Following President Trump's remarks, the Canadian dollar and Mexican peso fell by 1.2% and 1.1%, respectively, in the foreign exchange market. If a 25% tariff is imposed as Trump stated, forecasts indicate that the Bank of Canada may lower interest rates further than planned and the economy could fall into recession, potentially causing the Canadian dollar to drop to its lowest level in over 20 years. Nathan Tuft, chief portfolio manager at Manulife Investment Management, said, "Investors are uncertain, but they are suffering from the threat of ongoing tariff increases, so the U.S. dollar is bound to strengthen."